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THE WINDY CITY TRADER
P.O. Box 1673, Chicago, Illinois
(November 11, 1997) FINANCIAL INSTRUMENTS: Friday's unemployment number should have sent bonds reeling. The fact that they did not is very indicative of a skittish stock market. The Fed is certainly reluctant to raise rates now for fear of another meltdown in stocks. The bond rally shows that world-wide markets are still very nervous as this flight to quality continues. We think stocks will definitely be dicey for the next 3-6 months. A test back to 6800-7000 in the Dow seems likely. World-wide markets, particularly Asia will have to stabilize before our markets will. The S&P is trying to hold above the 925.00 support level. A push through there could drive prices back towards 880.00.
Stephen Connell and William Frejlich
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